Kenya Single Window Agency accuses KRA of Sabotage

KentradeThe Kenya Trade Network Agency, operator of the National Electronic Single Window System, has refuted claims by some clearing agents that the platform is lapsing. KenTrade has instead blamed slow integration of its system on the continued parallel use of the Kenya Revenue Authority’s systems – the Orbus and Simba. Currently, importers are using both systems to process documents such as import permits.

Project director Amos Wangora said there is need to retire Orbus system for agents to embrace the Single Window System, particularly in filing Import Declaration Forms. Kentrade accused KRA officials of avoiding the Single Window System.

“We don’t have any problem in the use of the Single Window System. It’s only people who don’t want to embrace the new system. Those using it are doing good only for some KRA officials who still want to use the Orbus system,” said Wangora in an interview on Friday.

KenTrade is the state agency tasked with facilitating cross-border trade through the Single Window System.

Wangora said only three modules remain for the Single Window System to be completed fully – include on declaration submission, bonds and exemption. Testing of the declaration submission module is on and is expected to be completed by 20 January 2015.

A section of clearing agents had raised concerns over delays in cargo clearance at the port of Mombasa under the Single Window System. Yesterday, the Kenya International Freight and Warehousing Association, Mombasa chapter, said KRA officials prefer their own system, which “lacks transparency”.

A clearing agent told the Star that one has to personally push for services, which involves handouts, under the KRA system. Kentrade has since written to KRA commissioner-general to halt the Orbus system on January 31.

The Single Window System integrates about 24 government agencies’ functions, offering a one-stop shop for processing import and export permit documents.  More than 6,000 imports and exports permits were issued under the new system last year, including permits from Kenya Bureau of Standards and Ministry of Health’s veterinary and pharmaceutical departments.

About 1,200 clearing agents, shipping agents, consolidators and partner government agencies will be trained on the remaining modules. Kentrade targets to have the system fully embraced by all stakeholders by July, with the country set to go paperless by 2015. Source: The Star (Kenya)

Mastermind and KRA Feud Over Tobacco Imports

Cigarettes+XXX+smokingWhile many nations are mulling over health legislation to curb tobacco use, it would seem the Kenyan authorities have opted for a conventional ‘delay-and-stall’ approach. From a trade facilitation perspective it is a disaster, but no doubt the ‘health propeller heads’ will be happy.

The Star (Kenya) reports that Mastermind Tobacco Kenya has accused the Kenya Revenue Authority of detaining its vehicles bringing in unprocessed tobacco from the Democratic Republic of Congo at the Malaba border for the last one month.

MTK Malaba liaison officer Robert Kiru said three trucks for its processing plant in Nairobi had been detained at the border since August 30 (2013) with no explanation coming from KRA.

“KRA Malaba station manager Philip Chirchir has not given concrete reasons why the trucks are held and neither have we been invoiced for any payment. Our three other trucks are still parked at Malaba Uganda with storage charges now totalling Sh300,000,” Kiru said. Addressing journalists at Malaba border Kiru dismissed as false claims by KRA that no bond had been paid on the impounded trucks. He however failed to show copies of the bond to prove payment.

MTK Corporate Affairs manager Josh Kirimania said he had talked to KRA top officers in Nairobi and wondered why none of them has ordered their officers in Malaba to release the trucks. “KRA have no tangible reasons to hold our trucks in Malaba. This is killing our business since we rely on imports from DRC and Uganda to sustain our business,” he said. Kirimania said KRA was ‘blocking’ their trade by continuously detaining their trucks at the Malaba border and called for an end to the practice. Chirchir could not be reached for comment as he was said to be in a security meeting. Source: The Star (Kenya)

Ugandan importers to boycott Mombasa

Ugandan importers say they intend avoiding using the Port of Mombasa in Kenya in favour of Tanzania’ Dar es Salaam in future, because of unresolved issues with the Kenyan taxman.

Some 600 containers destined for Uganda are being held at the Kenyan port following the introduction of a cash bond tax. The chairman of the Kampala Traders Association announced last week that the association had resolved to suspend using Mombasa in the interim, reports New Vision (Kampala).

In addition, importers say they will take legal action against the Kenya Revenue Authority (KRA) which has issued a directive instructing importers to lodge either a cash bond equivalent to the value of the imported goods or a bank guarantee to the same value. This must be deposited before the goods being imported can be cleared.

The directive has affected not only the 600 containers waiting at the port but imports of motor vehicles and sugar.

Uganda’s trade minister, Amelia Kyambadde said she had been informed by the Uganda business community that the KRA, under notice CUS/L&A/LEG/1 had made a unilateral decision on a requirement for a cash bond or bank guarantee on transit sugar and motor vehicles above 2000cc.

Ugandan authorities say the action by the KRA directive constitutes another non-tariff barrier imposed by Kenyan authorities on its transit cargo and contravenes East African Community Customs Union protocol and decisions reached by the Council of Ministers in March 2012 on removal of non-trade barriers in the community.

“If Kenya needs an instrument to regulate regional trade in sugar and other products, a cash bond is not the instrument to apply,” said Kyambadde. Sources: Ports.co.za / New Vision (Uganda).

Car importers slam KRA transit vehicles rule

Is the time for a regional transit bond nigh? Given prevailing draconian measures to ensure security and surety, the message is clear that customs brokers, freight forwarders or clearing agents need to demonstrate financial security over and beyond what they are accustomed to. Question – is the transit business lucrative for agents? Why not refuse the business – its just not worth the risk.

A requirement by the Kenya Revenue Authority demanding that all imported transit vehicles above 2000cc be cleared against cash bonds or bank guarantees has been opposed by clearing agents in Mombasa. The agents, under their umbrella Kenya International Freight and Warehousing Association, have threatened not to pay taxes if the regulations are not withdrawn by the tax collector. The agents said that the stringent measures by KRA may stifle trade in the region and may also see the port of Mombasa losing some foreign importers to the port of Dar es Salaam in Tanzania. “We as clearing agents cannot pay the bonds for the importers”.

On August 31, KRA directed all clearing agents that with effect from September 1, all transit vehicles exceeding 2000cc would be cleared against a cash bond or bank guarantees paid by the agents. The forwarders also said that Uganda, Rwanda and DR Congo business class was considering ditching Kenya as an import avenue for Dar es Salaam port. Source: The Star (Nairobi)